Abercrombie & Fitch hits New York's 5th Avenue

By Dawn Kissi

NEW YORK (Reuters) - Specialty retailer Abercrombie & Fitch opened its new flagship store on New York's 5th Ave. on Thursday, establishing itself among upscale luxury retailers such as Salvatore Ferragamo and Fendi.

With another location in lower Manhattan, the company's move uptown places it in the midst of some of the world's high-end retailers, while providing maximum visibility.

"If you're wanting to be an aspirational brand, there's no better place to be than Fifth Avenue," said WR Hambrecht analyst Pamela Nagler Quintiliano.

Known as a mall-based retailer, the company is beginning to move toward more stand-alone locations. Increasing its visibility in certain markets is also on the agenda, with new flagships planned for Los Angeles and Las Vegas in 2006.

Located at 720 Fifth Avenue, the four-story, 36,000-square- foot store will offer 28 different kinds of denim at two "denim bars," a fragrance selection and a varied collection of logo T-shirts.

By positioning itself on a tony stretch of 5th Avenue, the company joins affordable brands Gap Inc. , Banana Republic and the J.Crew on an expanse that houses Gucci and Asprey stores, alongside Neiman Marcus-owned Bergdorf Goodman stores.

"Opening a flagship store of that size also says something about the perceived strength of the brand by management," said Piper Jaffray retail analyst Jeffrey Klinefelter. "It's a significant physical presence."

The company, whose roots date back to 1892, is also looking toward an international expansion.

"They are going to go international," said Christine Chen, a retail analyst with Pacific Growth Equities. "But it will be a slow, controlled growth. Their strategy so far has always been in malls." (Additional reporting by Alexandria Sage in Los Angeles)